Grand Valley Lakes Property Owners Association, Inc. v. Dennis Burrow

IN THE COURT OF APPEALS OF TENNESSEE

AT JACKSON

November 16, 2011 Session

GRAND VALLEY LAKES PROPERTY OWNERS ASSOCIATION, INC. v.

DENNIS BURROW

Direct Appeal from the Circuit Court for Hardeman County

No. 06020202 J. Weber McCraw, Judge

No. W2011-00573-COA-R3-CV - Filed December 28, 2011

Appellant, the owner of several lots in a subdivision managed and maintained by the

Appellee home owners association, appeals the trial court’s grant of summary judgment in

favor of Appellee on the question of whether Appellant owed an increase in dues and fees

on his lots, and the denial of his counter-claims for fraud, violation of the Tennessee

Consumer Protection Act, outrageous conduct, and invalidity of the restrictive covenants on

grounds that these causes of action were barred by the applicable statutes of limitation or the

doctrine of laches. We conclude that the Appellee followed the correct procedure in

amending its restrictive covenants to increase the amount of dues. However, because the trial

court did not make findings, as required by Tennessee Rule of Civil Procedure 56.04,

concerning the grounds for its application of laches, we cannot review the question of

whether Appellant’s counter-claims were properly dismissed. Vacated and remanded.

Tenn. R. App. P. 3. Appeal as of Right; Judgment of the Circuit Court Vacated and

Remanded

J. S TEVEN S TAFFORD, J., delivered the opinion of the Court, in which A LAN E. H IGHERS, P.J.,

W.S., and H OLLY M. K IRBY, J., joined.

Matthew R. West, Jackson, Tennessee, for the appellant, Dennis Burrow.

Matthew R. Armour, Somerville, Tennessee, for the appellee, Grand Valley Lakes Property

Owners Association, Inc.

OPINION

Grand Valley Lakes Subdivision (the “Subdivision”) is a platted subdivision in

Saulsbury, Hardeman County, Tennessee. Grand Valley Lakes Property Owners Association,

Inc. (“Grand Valley,” or “Appellee”) is a non-profit corporation organized to manage and

maintain the covenants and common areas of the Subdivision.

Appellant Dennis Burrow has owned multiple lots in the Subdivision, dating back to

as early as 1973. Mr. Burrow owns, or has owned, lots 800, 801, 802, 807, 808, 809, and

811. All but two of these lots were purchased after March 21, 1998, when the amendments

to the restrictive covenants and bylaws were adopted by Grand Valley.1

The original restrictive covenants were adopted and recorded in 1972. These

covenants established annual dues for lot owners at $48.00 per year, and indicated that the

dues would remain unchanged until at least January 1, 1982. The restrictive covenants also

established a means by which the covenants could be amended, the particulars of which will

be discussed below.

In Grand Valley Lakes Property Owners Association, Inc. v. Charles Cary & Burton

Shearin, 897 S.W.2d 262 (Tenn. Ct. App. 1994) (“Shearin”), this Court addressed Grand

Valley’s attempt to amend its covenants. As will be discussed in greater detail below, in

Shearin, we held, inter alia, that Grand Valley had not followed its own procedure to

properly amend the restrictive covenants and that, consequently, the increased dues could not

be collected from Shearin.

In March 1998, Grand Valley wished to increase its dues and fees. Based upon our

holding in Shearin, and the specific requirements set out in its restrictive covenants, Grand

Valley called a special meeting for the purpose of amending its restrictive covenants and

bylaws2 . Notice of this meeting was forwarded to all lot owners and the notice stated that

the purpose of the meeting was to amend the restrictive covenants. A copy of the proposed

amendments was included in the notice. Following a vote of the lot owners, the amendments

passed, effective on or about March 21, 1998. Since that time, the Subdivision and Grand

1

There is some confusion in the record concerning whether the amendments were voted on at a

March 21, 1998 meeting or at a March 28, 1998 meeting. Although the parties’ briefs indicate the meeting

date as March 28, 1998, the Notice sent by Grand Valley indicates that the meeting was held on March 21,

1998. For purposes of this opinion, we will use the date set out in the Notice, i.e., March 21, 1998.

2

Article XI, Paragraph 4 addresses the procedure for amendment of the bylaws. It provides:

4. Amendment to Bylaws. The bylaws may only be amended at a meeting

of the membership of the corporation held for such purpose. The notice of

said meeting shall set forth the proposed amendments. The bylaws shall

only be amended by a vote of a majority of the members in attendance at

such a meeting and entitled to vote there at.

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Valley have been operating pursuant to the amended restrictive covenants.

For a period of time following the increase in dues, Mr. Burrow paid the increase on

the lots he owned. In fact, Mr. Burrow took no action regarding the amendments until he

was sued by Grand Valley to recover past due fees. This case has a long procedural history,

which we have thoroughly reviewed. However, for purposes of this appeal, and in the

interest of judicial economy, we will only include the procedure that is relevant to the issues

raised herein.3

Grand Valley initiated this litigation on March 25, 2002 in the Hardeman County

General Sessions Court, seeking to recover dues and fees (based upon the increased amounts

established by the March 21, 1998 vote) from Mr. Burrow. The complaint was amended on

July 26, 2006 to add additional lots to the action, and was amended a second time on October

14, 2006 to add claims for interest and late charges. By agreement of the parties, on

December 13, 2006, the case was removed to the Circuit Court at Hardeman County, where

protracted discovery ensued.

3

As a point of practice, we note that the appellate record in this case consists of twenty volumes of

technical record, comprised of 3,044 pages. In our review of every page of this prolific record, we found that

the majority of the pages therein were part and parcel of the protracted discovery that took place in this case.

It is, of course, incumbent upon the Appellant to prepare an adequate record for our review. Tenn. R. App.

P. 24(b). However, in preparing the record, the Appellant should not lose sight of the other mandates

contained in Tennessee Rule of Appellate Procedure 24. We specifically refer the parties to Tennessee Rule

of Appellate Procedure 24(a), concerning the content of the appellate record. This Rule provides, in relevant

part that:

The following papers filed in the trial court are excluded from the record:

(1) subpoenas or summonses for any witness or for any defendant when

there is an appearance for such defendant; (2) all papers relating to

discovery, including depositions, interrogatories and answers thereto,

reports of physical or mental examinations, requests to admit, and all

notices, motions or orders relating thereto; (3) any list from which jurors

are selected; and (4) trial briefs; and (5) minutes of opening and closing of

court. Any paper relating to discovery and offered in evidence for any

purpose shall be clearly identified and treated as an exhibit. No paper need

be included in the record more than once.

Tenn. R. App. P. 24(a) (emphasis added). Had the Appellant adhered to this rule regarding the exclusion of

discovery, our record would certainly have been more manageable and the interest of judicial economy would

have been better served. Because we very often see extraneous filings in the records, we take this opportunity

to remind our future appellants that they should endeavor to adhere to the rules when submitting records to

this Court.

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On June 11, 2007, Grand Valley was allowed to file an amended and restated

complaint in the Circuit Court. Therein, Grand Valley asks the court to award it $11,008.39

for dues, residential water charges, and water availability charges, plus $7,914.43 for

prejudgment interest at 10% per annum against Mr. Burrow.4 Grand Valley also asks for its

reasonable attorney’s fees. Concerning Grand Valley’s decision to increase its dues and fees

in March 1998, the complaint states:

4. On March 21, 1998, at a Special Meeting of the Members of

the [Grand Valley] property owner’s association, the Original

Restrictions were amended and a DECLARATION OF

AMENDED AND RESTATED RESTRICTIVE COVENANTS

F O R G R A N D V A L L E Y L A K E S S U B D IV ISIO N

HARDEMAN COUNTY, TENNESSEE,(the “Amended

Restriction”) were adopted. The Amended Restrictions were

recorded in Book K-16, Page 216 in the Register’s Office for

Hardeman County, Tennessee on April 2, 1998. Upon

information and belief, [Mr. Burrow] shortly after the adoption

of the Amended Restriction had actual knowledge that [Grand

Valley] intended to enforce these provisions as to all Lots in

Grand Valley Lakes Subdivision in the place of the Original

Restrictions. The Amended Restrictions permit the Board of

Directors of [Grand Valley] to set the annual dues and water

charges for Lots. It also imposes late charges and costs of

collection including attorneys’ fees on delinquent obligations

owed to [Grand Valley].

(emphasis in original). On June 22, 2007, Mr. Burrow filed his answer to the complaint, in

which he denied the material allegations thereof, and specifically denied that “the alleged

March 21, 1998 Special Meeting of the Members was a proper, authorized Special Meeting.”

Mr. Burrow further denied that “any votes and/or subsequent actions pursuant to said

meeting were proper.” Based upon these assertions, Mr. Burrow stated his belief that the

amended restrictions (i.e., specifically, the dues increase) were not properly executed and

were, therefore, void ab initio. Concurrent with his answer, Mr. Burrow filed a counter-

complaint against Grand Valley, alleging causes of action for fraud, violation of the

4

On August 5, 2010, Grand Valley was granted leave to file a second amended and restated

complaint to modify its pray for relief to reflect additional dues allegedly accrued by Mr. Burrow during the

pendency of the litigation. The August 5, 2010 amendment reflected a request for damages of $20,340.60

for dues, residential water, and water availability charges; $900 for Lot 801 water disconnect fees; and

$21,125.75 for prejudgment interest at a rate of 10% per annum.

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Tennessee Consumer Protection Act, outrageous conduct, and invalidity of the restrictive

covenants. On April 18, 2008, Grand Valley filed an answer to the counter-claim. In

addition to reiterating its position, as set out in the complaint, that the March 21, 1998 special

meeting was valid and that the vote to amend and restate the restrictive covenants was,

likewise, valid, Grand Valley also noted, in paragraph thirteen of its answer, that the bylaws

adopted by the membership on March 21, 1998 permitted the Board to establish, on an

annual basis on or before March 1st , the amount of regular dues for the association. Grand

Valley also stated that the bylaws set the maximum annual dues at $200.00 per lot per year

effective for the annual dues payable on April 1, 1998, and further limited the amount of any

increase to 5% of the previous year’s dues. As affirmative defenses to Mr. Burrow’s

counter-claims, Grand Valley raised the applicable statutes of limitation and repose, and the

doctrine of laches.

On May 25, 2010, Grand Valley filed a motion for summary judgment, which

requested judgment on the alleged dues/fees owed by Mr. Burrow ($42,366.35), a dismissal

of Mr. Burrow’s counter-claims as being barred by the applicable statute of limitations and

the doctrine of laches, and an award of Grand Valley’s reasonable attorney’s fees. On

August 3, 2010, Mr. Burrow filed a cross-motion for partial summary judgment declaring

Grand Valley’s March 21, 1998 amended restrictions to be void and unenforceable.

The motions for summary judgment were heard by the trial court on January 3, 2011.

By Order of January 27, 2011, the court granted Grand Valley’s motion for summary

judgment, and denied Mr. Burrow’s motion for partial summary judgment, finding his claims

barred by the applicable statutes of limitation or by the doctrine of laches. On February 24,

2011, Grand Valley moved the court to alter or amend its judgment to grant a specific money

judgment against Mr. Burrow, and to award Grand Valley its attorney’s fees. In support of

its motion, Grand Valley provided affidavits and statements to support its request for

attorney’s fees. Mr. Burrow opposed the motion to alter or amend, but provided no evidence

to rebut Grand Valley’s attorney’s affidavits and statements.

On April 1, 2011, the trial court entered a final money judgment and order of

dismissal, wherein it upheld the grant of summary judgment in favor of Grand Valley and the

denial of Mr. Burrow’s motion for partial summary judgment. The court awarded Grand

Valley a money judgment in the amount of $45,786.67 for dues, water charges, interest and

late fees. This amount is itemized by lot number in the trial court’s order. Based upon

Paragraph 5.6 of the amended restrictive covenants, which allows for recovery of attorney’s

fees, the trial court also awarded Grand Valley $125,000 in attorney’s fees as set out in the

unopposed affidavit of Grand Valley’s attorney, George Fusner, Jr., for a total money

judgment of $170,786.67.

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Mr. Burrow appeals and raises five issues for review as stated in his brief:

1. Whether the trial court erred by denying Appellant’s motion

for partial summary judgment when there exists no genuine

issue of material fact that [Grand Valley’s] March 21, 1998 vote

failed to properly amend its restrictive covenants pursuant to the

terms of its original restrictive covenants and this Court’s

holding in Shearin.

2. Whether the trial court erred when it held that Appellant’s

counter-claims challenging [Grand Valley’s] March 21, 1998

vote were “barred by applicable statutes of limitation or by the

doctrine of laches.”

3. Whether the trial court erred by granting Appellee’s motion

to alter or amend the judgment when no showing or finding was

made as to a clear error of law or injustice.

4. Whether the trial court erred by granting Appellee’s attorney

fees when the “American Rule” requires parties to pay their own

attorney fees and when the alleged, amended restrictive

covenants require each party to pay their own attorney fees.

5. Whether the trial court erred by granting a judgment for pre-

judgment interest when Appellant had a reasonable dispute to be

litigated and such a judgment was merely punitive.

Summary Judgment

A trial court's decision to grant a motion for summary judgment presents a question

of law. Our review is, therefore, de novo with no presumption of correctness afforded to the

trial court's determination. Bain v. Wells, 936 S.W.2d 618, 622 (Tenn. 1997). “This Court

must make a fresh determination that the requirements of Tennessee Rule of Civil Procedure

56 have been satisfied.” M athews Partners, L.L.C . v. Lem m e, N o.

M2008–01036–COA–R3–CV, 2009 WL 3172134, at *3 (citing Hunter v. Brown, 955

S.W.2d 49, 50–51 (Tenn. 1977)).

When a motion for summary judgment is made, the moving party has the burden of

showing that “there is no genuine issue as to any material fact and the moving party is

entitled to judgment as a matter of law.” Tenn. R. Civ. P. 56.04. The moving party may

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accomplish this by either: (1) affirmatively negating an essential element of the non-moving

party's claim; or (2) showing that the non-moving party will not be able to prove an essential

element at trial. Hannan v. Alltel Publ'g Co., 270 S.W.3d 1, 8–9 (Tenn. 2008). However,

“[i]t is not enough for the moving party to challenge the nonmoving party to ‘put up or

shutup’ or even to cast doubt on a party's ability to prove an element at trial.” Id. at 8. If the

moving party's motion is properly supported, “[t]he burden of production then shifts to the

nonmoving party to show that a genuine issue of material fact exists.” Id. at 5 (citing Byrd

v. Hall, 847 S.W.2d 208, 215 (Tenn. 1993)). The non-moving party may accomplish this by:

“(1) pointing to evidence establishing material factual disputes that were overlooked or

ignored by the moving party; (2) rehabilitating the evidence attacked by the moving party;

(3) producing additional evidence establishing the existence of a genuine issue for the trial;

or (4) submitting an affidavit explaining the necessity for further discovery pursuant to Tenn.

R. Civ. P. 56.06.” Martin v. Norfolk S. Ry. Co., 271 S.W.3d 76, 84 (Tenn. 2008) (citations

omitted).

When reviewing the evidence, we must determine whether factual disputes exist. In

evaluating the trial court's decision, we review the evidence in the light most favorable to the

nonmoving party and draw all reasonable inferences in the nonmoving party's favor. Stovall

v. Clarke, 113 S.W.3d 715, 721 (Tenn. 2003). If we find a disputed fact, we must “determine

whether the fact is material to the claim or defense upon which summary judgment is

predicated and whether the disputed fact creates a genuine issue for trial.” Mathews

Partners, 2009 WL 3172134, at *3 (citing Byrd, 847 S.W.2d at 214). “A disputed fact is

material if it must be decided in order to resolve the substantive claim or defense at which

the motion is directed.” Byrd, 847 S.W.2d at 215. A genuine issue exists if “a reasonable jury

could legitimately resolve the fact in favor of one side or the other.” Id. “Summary

[j]udgment is only appropriate when the facts and the legal conclusions drawn from the facts

reasonably permit only one conclusion.” Landry v. South Cumberland Amoco, et al., No.

E2009–01354–COA–R3–CV, 2010 WL 845390, at *3 (Tenn. Ct. App. March 10, 2010)

(citing Carvell v. Bottoms, 900 S.W.2d 23 (Tenn. 1995)). However, if there is any

uncertainty concerning a material fact, then summary judgment is not the appropriate

disposition. As stated by our Supreme Court in Evco Corp. v. Ross, 528 S.W.2d 20 (Tenn.

1975):

The summary judgment procedure was designed to provide a

quick, inexpensive means of concluding cases, in whole or in

part, upon issues as to which there is no dispute regarding the

material facts. Where there does exist a dispute as to facts which

are deemed material by the trial court, however, or where there

is uncertainty as to whether there may be such a dispute, the

duty of the trial court is clear. He [or she] is to overrule any

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motion for summary judgment in such cases, because summary

judgment proceedings are not in any sense to be viewed as a

substitute for a trial of disputed factual issues.

Id. at 24–25.

Concerning the contents of the trial court’s order on a motion for summary judgment,

as discussed in this Court's recent opinion, Winn v. Welch Farm, L.L.C., No.

M2009–01595–COA–R3–CV, 2010 WL 2265451 (Tenn. Ct. App. June 4, 2010):

In 2007, Tennessee Rule of Civil Procedure 56.04 was amended

to require the trial court to “state the legal grounds upon which

the court denies or grants the motion,” and to include such

statement in the order reflecting the trial court's ruling. When the

legal grounds for the trial court's decision are omitted, a

reviewing court cannot analyze the decision's validity, and

appellate review becomes unnecessarily speculative. “Without

such a statement ... a reviewing court is left to wonder on what

grounds the trial court granted the motion for summary

judgment.” Eluhu v. HCA Health Servs. of Tenn. Inc., No.

M2008–01152–COA–R3–CV, 2009 WL 3460370, at *21. The

2007 amendment to Tenn. R. Civ. P. 56.04 was intended to cure

this problem. The Rule's requirements are specific and without

exception. Tenn. R. Civ. P. 56.04; see also Eluhu, 2009 WL

3460370, at *21(vacating the trial court's grant of summary

judgment upon finding that the trial court did not state the legal

grounds upon which the trial court granted the motion); Burse

v. Hicks, No. W2007–02848–COA–R3–CV, 2008 WL 4414718,

at *2 (Tenn.Ct.App. Sept. 30, 2008) (finding noncompliance

with Rule 56 .04 where trial court's order merely provided “it is

hereby ordered, adjudged and decreed that the Motion for

Summary Judgment of [the defendant] is well taken and should

be granted pursuant to law and there being no material disputed

fact,” but proceeding with appellate review upon a finding that

there was only a “clear legal issue”).

Winn v. Welch Farm, 2010 WL 2265451, at *5.

In Winn, this Court determined that the order appealed did not comply with Rule

56.04 because the order merely stated that “the Court believes there are no genuine issues of

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material fact and that the Respondents are entitled to judgment as a matter of law .” Winn

v. Welch Farm, 2010 WL 2265451, at *6. Because the Winn case did not present “a clear

legal issue. Id. (citation omitted), we were not able to “soldier on without guidance from the

trial court.’” Id. (citing Church v. Perales, 39 S.W.3d 149, 158 (Tenn. Ct. App.2000)).

In White v. Pulaski Elec. Sys., No. M2007–01835–COA–R3–CV, 2008 WL 3850525,

at *3 (Tenn. Ct. App. Aug. 18, 2008) this Court proceeded with review after determining that

the legal grounds upon which the trial court granted summary judgment were “readily found”

in the transcript of the hearing contained in the record and that the revisions to the rule

became effective after the hearing and only twelve days prior to the entry of the order. See

also Burgess v. Kone, Inc., No. M2007–0259–COA–R3–CV, 2008 WL 2796409 (Tenn. Ct.

App. July 18, 2008) (proceeding with review after finding that the basis for the trial court's

decision was “readily ascertainable” from a CD–Rom of the hearing that was contained

within the appellate record). By citing Church and White, we do not wish to imply that it is

the obligation of this Court to scrutinize the transcript in order to discern a trial court's

reasoning, and to only apply the mandatory language of Tennessee Rule of Civil Procedure

56.04 if that reasoning cannot be determined. Because a trial court speaks through its orders,

Palmer v. Palmer, 562 S.W.2d 833, 837 (Tenn. Ct. App.1977), Tennessee Rule of Civil

Procedure 56.04 ensures that the trial court's voice is clearly understood by any reviewing

court.5

Concerning the grant of summary judgment in favor of Grand Valley, the trial court’s

January 27, 2011 order merely states that it “finds no material evidence to negate any of the

material statements of fact and that there is no genuine issue as to any material fact as

presented by [Grand Valley] and that [Grand Valley] is entitled to summary judgment.” The

5

In Cunningham v. Cunningham, No. W2006–02685–COA–R3–CV, 2008 WL 2521425 (Tenn.

Ct. App. June 25, 2008), this Court explained:

A judgment must be reduced to writing in order to be valid. It is inchoate,

and has no force whatever, until it has been reduced to writing and entered

on the minutes of the court, and is completely within the power of the judge

or Chancellor. A judge may modify, reverse, or make any other change in

his judgment that he may deem proper, until it is entered on the minutes,

and he may then change, modify, vacate or amend it during that term,

unless the term continues longer than thirty days after the entry of the

judgment, and then until the end of the thirty days.

Cunningham, 2008 WL 2521425, at *5 (citing Broadway Motor Co., Inc. v. Fire Ins. Co., 12 Tenn.App.

278, 280 (1930)). Consequently, “[w]e do not review the court's oral statements, unless incorporated in a

decree, but review the court's order and judgments for that is how a court speaks.” Id.

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April 1, 2011 final money judgment and order of dismissal does not elaborate on the trial

court’s grounds for the grant of summary judgment to Grand Valley. The trial court’s broad

statement that there is no dispute of material fact and that Grand Valley is entitled to

judgment as a matter of law is insufficient to comply with the mandates of Tennessee Rule

of Civil Procedure 56.04. However, despite the shortcomings in the court’s orders, the

question of whether Grand Valley is entitled to summary judgment presents a clear legal

issue—i.e., whether Grand Valley’s restrictive covenants were properly amended. The

record is well developed on this question; consequently, under the precedent set in the

Church and White line of cases, we will “soldier on,” in the face of a lack of compliance

with Rule 56.04, to address the issue of whether the amended restrictive covenants can be

enforced against Mr. Burrow.

Turning to that issue, as briefly discussed above, Grand Valley was originally

governed by the1972 restrictive covenants, which provided that “[e]ach lot owner shall be

subject to an annual dues charge of $48.00, which he agrees to pay to [Grand Valley]. . . as

provided in the Code of Regulations of said association [i.e., the bylaws], annually, on the

1st day of April.” These fees, “for the improvement, maintenance and upkeep of various

areas for use of the property owners,” could not be changed until after January 1, 1982. The

original restrictive covenants provided two options/procedures that could be used by Grand

Valley to amend the restrictive covenants and raise the dues, namely:

All restrictions may be hereafter [i.e., after January 1, 1982]

changed, altered, amended or revoked in whole or in part by the

owners of the lots in the Subdivision whenever the owners of at

leas[t] two thirds of the said lots so agree in writing, or by action

of the Grand Valley Property Owners Association at a meeting

duly called for said purpose by a vote of at least a majority of

the members thereof.

These covenants remained unchanged until March 21, 1998 when Grand Valley attempted

to amend them. Prior to March 1998, the record reveals that Grand Valley had a history of

failed attempts to raise the dues. As noted above, one of Grand Valley’s previous attempts

to raise dues came before this court in Shearin. In that case, Burton Shearin argued that

Grand Valley’s bylaws governed the process for raising dues. We disagreed with Mr.

Shearin, and held that: (1) Grand Valley’s original restrictive covenants, as opposed to the

bylaws, governed the procedure for raising dues; (2) In order to amend the original restrictive

covenants, Grand Valley must amend by one of the two options/procedures set out in its

restrictive covenants. Shearin, 897 S.W.2d at 269. Mr. Shearin’s petition for writ of

certiorari to our Supreme Court was denied on January 3, 1995, and there has been no

intervening caselaw to disrupt the holding in the case.

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In the instant case, Mr. Burrow argues that Grand Valley failed to follow its original

restrictive covenants and this Court’s holding in Shearin when it voted, on March 21, 1998,

to amend the restrictive covenants to include an increase in dues and fees. Consequently, Mr.

Burrow contends that the March 1998 amendments to the restrictive covenants are void ab

initio. Therefore, Mr. Burrow argues that he is not bound by the amendments and does not

owe the increase in dues and fees, or any penalties for failure to pay them. The issue of

whether summary judgment was correctly granted to Grand Valley and denied to Mr. Burrow

rests upon a determination of whether Grand Valley correctly followed its procedure for

amending the restrictive covenants, or whether there is a dispute of fact concerning the

procedure used. From our reading of Mr. Burrow’s brief, we conclude that his argument

rests, in large part, upon his interpretation of our holding in Shearin. As is relevant to this

case, in Shearin, we specifically stated:

Grand Valley sought to recover from Shearin delinquent

property owner association dues alleged to be owed by him.

Shearin contended that the property owner association dues had

not been lawfully increased in accordance with the Restrictive

Covenants as filed in the Register's Office in Hardeman County.

Grand Valley asserted that the By-laws, and not the Restrictive

Covenants, governed the increase of property owners' dues, and

that all increases had been made in accordance with its By-laws.

The chancellor found that the Restrictive Covenants governed,

and that a majority of the members of the subdivision had never

voted to increase the dues. The chancellor limited plaintiff's

claim against Shearin to $48.00 per lot per year, and awarded

defendant a judgment for excess payment of dues against

plaintiff in the amount of $864.00.

The Restrictive Covenants establish the dues of property owners

at $48.00 per year per lot. The same covenants also provided

that this amount could not be changed until after January 1,

1982. No attempt was ever made to change the dues according

to the procedure set forth in the Restrictive Covenants, which

require two-thirds of all lot owners agreeing in writing to put

into effect an increase, or a meeting specially called for the

purpose of changing the dues in which two-thirds [sic, see

discussion below] of all members of the subdivision approved

the increase. As to this issue, we find no error by the chancellor.

Shearin, 897 S.W.2d at 269.

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Before going further into the question of whether the grant of summary judgment in

favor of Grand Valley was error, we first pause to address two points where Mr. Burrow has

incorrectly analyzed our holding in Shearin. As set out in full context above, we state that

“the procedure set forth in the Restrictive Covenants [] requires two-thirds of all lot owners

agreeing in writing to put into effect an increase, or a meeting specially called for the purpose

of changing the dues in which two-thirds of all members of the subdivision approved the

increase.” Shearin, 897 S.W.2d at 269 (emphasis added). Our statement that two-thirds

approval is required is a misnomer. Our holding in Shearin is that the restrictive covenants

govern the procedure for amendments. Id. As set out above, the restrictive covenants clearly

state that it is the majority that must prevail in the vote, and not two-thirds of the members.

While we concede that our mistake in Shearin may cause confusion, we now wish to clarify

that it is the majority vote that counts under the restrictive covenants and not the two-third’s

vote. So, under Shearin, in order to amend its restrictive covenants to raise dues, Grand

Valley must follow its restrictive covenants, which require Grand Valley to either obtain the

agreement of two thirds of the lot owners in writing, or to duly call a meeting at which at

least a majority of the members vote for the amendment.

From his brief, Mr. Burrow also misconstrues our holding in Shearin (i.e., that the

restrictive covenants control) to mean that the bylaws have no bearing on Grand Valley’s

actions. Consequently, his brief does not rely on the bylaws, and, in fact, argues that the

bylaws should not be considered based upon our holding in Shearin. While it is the

restrictive covenants that govern the applicable amendment procedure, our holding in

Shearin does not go so far as hold that the bylaws should be ignored all together. Our

holding, therefore, is more narrow than Mr. Burrow’s brief suggests. In Shearin, it was the

correct procedure (as between that set out in the restrictive covenants and that set out in the

bylaws) that was the issue. Because the restrictive covenants specifically set out the

procedure for amendments thereto, we held that the procedure outlined in the restrictive

covenants controlled any attempts to amend them. In the instant case, however, the issue is

slightly different. The question here is whether that procedure was actually followed.

Contrary to Mr. Burrow’s contention that we should ignore the bylaws in addressing this

question, a close reading of the restrictive covenants indicates that the restrictive covenants

and the bylaws are not mutually exclusive. The plain language of the restrictive covenants

supports this interpretation, when it refers to “annual dues. . . as provided in the Code of

Regulations [i.e., the bylaws],” and that the owners must also “comply with all rules and

regulations from time to time promulgated by said Association.” Consequently, if the

restrictive covenants do not specifically or thoroughly address a question, then we would

look to the bylaws for more guidance.

Because the instant case involves the interpretation of restrictive covenants, we apply

well-established rules of construction and law in order to construe the terms of the covenants.

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Parks v. Richardson, 567 S.W.2d 465, 467 (Tenn. Ct. App. 1977). In the instant case, we

interpret the restrictive covenants to allow reference to the bylaws when there is some

question left unanswered by the restrictive covenants. However, where the restrictive

covenants clearly outline the procedure for amendment, we do not need to go outside the four

corners of the restrictive covenants. Shearin, 897 S.W.2d at 269. Thus, if the “meaning of

the covenant is reasonable and unambiguous, there is no need to seek further clarification

outside its language.” Shea v. Sargent, 499 S.W.2d 871, 874 (Tenn. 1973). If the language

of the restrictive covenant is unambiguous, and its plain meaning is fair and reasonable, then

its terms may not be altered or varied by parol evidence. Hicks, 978 S.W.2d at 547–48

(citations omitted). However, if the bylaws are needed, then we would also interpret them

in compliance with the well-established rules governing interpretation of other written

contracts, where the primary goal is to ascertain the intention of the parties as expressed by

the language of the document itself. See Hicks v. Cox, 978 S.W.2d 544, 547 (Tenn. Ct. App.

1998). The words of a contract must be given their usual and ordinary meaning. Hicks, 978

S.W.2d at 547 (citing Aldridge v. Morgan, 912 S.W.2d 151, 153 (Tenn. Ct. App. 1995);

Rainey v. Stansell, 836 S.W.2d 117, 119 (Tenn. Ct. App. 1992)).6

Returning to the question of summary judgment, because there is no written

agreement of two-third’s of the lot owners, in the instant case we are concerned only with

the second option for the amendments (i.e., a duly called meeting where a majority of owners

vote for the amendment). The restrictive covenants do not define what is meant by “duly

called,” or who is an “owner” for purposes of voting. Consequently, we find guidance on

these questions in the bylaws, and particularly Article V thereof, which provides, in relevant

part that:

6

We are mindful that restrictions on the free use and enjoyment of real property are not favored in

Tennessee. See, e.g ., Waller v. Thomas, 545 S.W.2d 745, 747 (Tenn. Ct. App. 1976). As such, "a restrictive

covenant, being in derogation of the free use and enjoyment of property, will be strictly construed against

the restriction and in favor of the reasonable use of the property, so that only uses clearly prohibited will be

held precluded by such a covenant." Parks, 567 S.W.2d at 468 (citing Shea, 499 S.W.2d at 872–73; Lowe

v. Wilson, 250 S.W.2d 366, 367 (Tenn. 1952)). Any doubt concerning the applicability of a restrictive

covenant will be resolved against the restriction. Richards v. Abbottsford Homeowners Ass'n, 809 S.W.2d

193, 195 (Tenn. Ct. App. 1990). Likewise, any ambiguity in the terms of the restrictive covenant will be

resolved against the restriction. Parks, 567 S.W.2d at 468; see also Waller, 545 S.W.2d at 747. Restrictive

covenants "will not be extended by implication to anything not clearly and expressly prohibited by their plain

terms." Turnley v. Garfinkel, 362 S.W.2d 921, 923 (Tenn. 1962); see also Maples Homeowners Ass'n, Inc.

v. T & R Nashville Ltd. P'ship, 993 S.W.2d 36, 39 (Tenn. Ct. App. 1998). Nevertheless, courts are required

to give a fair and reasonable meaning to the restrictive covenant, Jones v. England, 870 S.W.2d 525, 529

(Tenn. Ct. App. 1993), and "such restrictions, like other contracts, will be enforced according to the clearly

expressed intention of the parties." Benton v. Bush, 644 S.W.2d 690, 691 (Tenn. Ct. App. 1982). We

conclude that our interpretation of the restrictive covenants to allow referral to the bylaws is not in

derogation of the intent of the drafters, and is not otherwise an extension of the restrictive covenants.

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3. Special Meetings. Special meetings of the members of the

corporation may be called by the President, Vice-President,

Secretary, or by a majority of the Board of Directors. A meeting

must be called by any such officer upon receipt of a written

request for a special meeting signed by not less than 10% of all

members having voting rights. Such written request shall state

the purpose or purposes of the proposed meeting. Said meeting

shall be called and held within thirty (30) days of receipt of the

written request or by a vote of the Board of Directors. It shall

not be necessary for the Board of Directors to hold a meeting to

call the meeting following receipt of the written request. The

business transacted at the special meeting shall be confined to

the purposes stated in the notice unless four-fifths of the

members present, either in person or by proxy, consent.

4. Fixing Record Date: Only those members of record, fifteen

days before any meeting of the corporation and who are in good

standing at the time of the meeting shall be entitled to notice of

such meeting and be entitled to vote at said meeting.

5. Notice of Meetings. Notice of meetings of the members of

the corporation shall be given to all eligible members. Notice of

the meetings, other than the annual meeting, shall indicate and

state that it is issued by or called at the direction of the person or

persons calling the meeting and state the items to be considered

at the meeting. All notices of any meetings shall be mailed not

less than (10) nor more than thirty (30) days prior to the date of

the meeting.

6. Waiver of Notice. Notice of meetings need not be given to

any member of the corporation who signs a waiver of notice,

whether in person or by proxy, whether before or after the

meeting. The attendance of any member at a meeting, in person

or proxy, without protesting the lack of knowledge prior to the

conclusion of the meeting shall constitute a waiver of notice of

the meeting to him.

***

8. Voting. Each member shall be entitled to one vote per lot

owned on each matter submitted to a vote of the members.

Article IV of the bylaws addresses membership and provides, in pertinent part, that:

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1. Eligibility. Every person who purchases a lot in the Grand

Valley Lakes Subdivision become[s] a member of this

corporation; and the developer shall be a member until it no

longer has an interest in the subdivision and resigns.

The bylaws further states that, “when any member shall be in default for a period of thirty

(30) days in the payment of dues or assessments following the adoption thereof, he shall, for

purposes of voting, not be considered as a member in good standing.”

Turning to the record, Grand Valley’s voting records were attested to by its Secretary,

Ann Wood. Ms. Wood’s testimony is corroborated by the March 21, 1998 Certificate of

Secretary, and the Announcement of Vote. Mr. Burrow concedes that Ms. Wood’s

testimony, and the supporting documentation “fairly and accurately depict the results of the

March 21, 1998 vote.” In short, Ms. Wood’s testimony is uncontested. Her records show

that, at the time of the March 21, 1998 vote, Grand Valley had 1,888 members in good

standing. The total members present, including by proxy, was 1,056. 1,044 votes were cast

in favor of the amendments.

Relying upon our incorrect statement in Shearin (i.e., that the second option for

amending the restrictive covenants required two-thirds of the vote, rather than a majority),

Mr. Burrow first contends that the amendments could only pass if two-thirds, or 1,258 votes,

were cast in favor of the changes. Again, our holding in Shearin was that the restrictive

covenants governed amendments. As set out above, the restrictive covenants clearly state

that the majority vote is required. Consequently, the 1,044 affirmative votes were sufficient

to carry the motion to amend the restrictive covenants.

It is uncontested in the record that the votes cast at the March 21, 1998 meeting were

not one member – one vote. Rather, the votes represented each lot that was in good standing.

So, many members cast more than one vote depending on how many lots in good standing

that member owned. Mr. Burrow argues that this one lot – one vote arrangement is

erroneous, and that each member, regardless of how many lots he or she owns, gets only one

vote. This interpretation is clearly in conflict with the bylaws. Having previously

determined that the bylaws may be considered when interpreting any amendment questions

that are left unanswered in the restrictive covenants, the bylaws clearly state that, in special

meetings, “[e]ach member shall be entitled to one vote per lot owned on each matter

submitted to a vote of the members.” Mr. Burrow further contends that, because one entity,

Valley Development Company, LLC, was allowed to cast 662 separate votes, one for each

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of its 662 lots, it was allowed to control the vote.7 While this may be true the bylaws explain

that “the developer shall be a member until it no longer has an interest in the subdivision and

resigns.” Consequently, under the plain language of the bylaws, we cannot conclude that this

practice conflicted with Grand Valley’s rules and regulations so as to render the vote void.

Mr. Burrow’s remaining arguments concerning the validity of the March 21, 1998

vote rest upon his assertion that the Special Meeting was not correctly called, and that the

notice given was insufficient. It is undisputed that the following notice was sent to all

members and that the notice was also posted in public areas of the Subdivision on or about

March 9, 1998:

NOTICE

OF

SPECIAL MEETING OF MEMBERS

MARCH 21, 1998 10 A.M.

POA OFFICE

135 GOLD DRIVE

SAULSBURY, TN 38067

Notice is hereby given of a Special Called Meeting of the

members of the Grand Valley Lakes Property Owners

Association, Inc. (the “Association”) for Saturday, March 21,

1998. . . . The purpose of the meeting is to consider the

adoption of:

1. AMENDED AND RESTATED BYLAWS OF GRAND

VALLEY LAKES PROPERTY OWNERS ASSOCIATION,

INC.

2. DECLARATION OF AMENDED AND RESTATED

RESTRICTIVE COVENANTS FOR GRAND VALLEY

L A K E S S U B D IV IS IO N , H A R D E M A N C O U N T Y ,

TENNESSEE; and

3. Any other business that may lawfully come before a Special

Called Meeting of Members of the Association.

7

We infer from the record that Valley Development Company, L.L.C. is the developer of the

Subdivision, and that it retained ownership of these 662 lots that remained unsold.

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Copies of the Bylaws and Restrictive Covenants to be

considered and voted upon are enclosed with this notice. The

Board of Directors approved these documents, recommended

their adoption by the members, and called this special meeting

at board meetings held on February 13 and 27, 1998.

(emphasis in original). In addition to the foregoing notice, the Board of Directors also sent

the following information to all property owners in an open letter, which provides, in

pertinent part, as follows:

Enclosed with this letter you will find a Notice of a Special

Called Meeting of Members setting a meeting for March 21,

1998.

THIS IS THE MOST IMPORTANT MEETING EVER

HELD AT GRAND VALLEY.

The purpose of the meeting is to adopt revised Bylaws and

Restrictive Covenants for Grand Valley. Our existing

documents were created in 1972 and are outdated. Adverse

court rulings have severely limited the Association’s ability to

raise funds and carry out its functions in operating the common

facility and amenities. Without the adoption of these documents

the Property Owners Association will not be able to continue to

function. The value of your property will decrease significantly

as a result.

Please carefully read the enclosed Bylaws and Restrictive

Covenants and plan to attend the Special Called Meeting.8

The Declaration of Amended and Restated Covenants and Bylaws for the Subdivision was

included with this correspondence.

As set out above, the Notice specifically states that the “Board of Directors . . . called

this special meeting at board meetings held on February 13 and 27, 1998.” Mr. Burrow

contends that a special meeting to raise dues cannot be called by the Board, but must be

called by the members of Grand Valley. We disagree. The bylaws specifically provide that

“[s]pecial meetings of the members of the corporation may be called by the President, Vice-

8

A proxy form was also included for those members who were unable to be present at the meeting.

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President, Secretary, or by a majority of the Board of Directors.” Although the bylaws

go on to say that “[a] meeting must be called by any such officer upon receipt of a written

request for a special meeting signed by not less than 10% of all members having voting

rights,” we cannot go so far as to interpret this language to require a written request signed

by not less than 10% of all members before a meeting may be called. While a written

request of the members is one way to necessitate the call of a special meeting, the bylaws

clearly allow that a meeting may also be called at the behest of a majority of the Board of

Directors. This is what happened here. Consequently, the fact that it was the Board of

Directors that called the special meeting does not negate the validity thereof.

Mr. Burrow further argues that the Notice did not clearly indicate that it was for the

purpose of raising dues. As set out in full context above, the restrictive covenants require

that the meeting be “duly called for said purpose.” Mr. Burrow reads the language “for said

purpose” to require that the meeting be called “for said purpose of raising dues.” We cannot

adopt Mr. Burrow’s reading of the restrictive covenants. The restrictive covenants require

that, in order to amend the restrictive covenants, a meeting must be called for that purpose

[i.e., the meeting must be called for the purpose of amending the restrictive covenants].”

That is what happened in this case. As set out in the Notice above, the Board of Directors

called the special meeting for the purpose of amending the bylaws and restrictive covenants.

Consequently, the restrictive covenants were satisfied. However, even if we give Mr.

Burrow the benefit of all inferences, and assume, arguendo, that the Notice required a

specific statement that the meeting’s purpose was to raise dues and fees, this requirement was

satisfied by the inclusion of the amended and restated restrictive covenants and bylaws in the

mailing.

Finally, Mr. Burrow argues that Grand Valley improperly eliminated votes of lot

owners who were not in good standing. His argument rests upon his sole reliance upon the

restrictive covenants, which do not specifically indicate that the votes of members not in

good standing are to be omitted from any vote to amend the restrictive covenants. Again,

Mr. Burrow’s argument fails to consider the bylaws, which clearly state that “[o]nly those

members of record, fifteen days before any meeting of the corporation and who are in good

standing at the time of the meeting shall be entitled to notice of such meeting and be entitled

to vote at said meeting,” and that, “when any member shall be in default for a period of thirty

(30) days in the payment of dues or assessments following the adoption thereof, he shall, for

purposes of voting, not be considered as a member in good standing.” It is undisputed that

the foregoing Notice was forwarded to all members, regardless of whether their dues were

fully paid. However, no votes cast by members not in good standing were counted. Because

the restrictive covenants do not specifically address the question of who is entitled to notice,

and who may vote at the called meeting to amend the restrictive covenants, we find guidance

in the bylaws. We can only interpret the foregoing provisions in the bylaws to bar the

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consideration of any votes cast by members not in good standing. Consequently, we cannot

conclude that the omission of these votes was error on the part of Grand Valley.

Having determined that the undisputed facts in the record clearly support a finding

that Grand Valley followed its own restrictive covenants in voting to amend its restrictive

covenants and bylaws, the grant of summary judgment in favor of Grand Valley on the

question of the validity of the March 21, 1998 vote was correct unless any of Mr. Burrow’s

counter-claims survive. We now turn to address that question.

Statutes of Limitation and Laches

The trial court held that Mr. Burrow’s counter-claims of fraud, violation of the

Tennessee Consumer Protection Act, Outrageous Conduct, and invalidity of the restrictive

covenants were “barred by the applicable statutes of limitations or by the doctrine of laches.”

Neither the January 27, 2011 order, nor the April 1, 2011 order, state which statutes of

limitation are applicable to Mr. Burrow’s claims. Grand Valley’s motion for summary

judgment argues that Mr. Burrow’s claims are barred by Tennessee’s six-year statute of

limitations for breach of contract; the three year statute of limitations for property damage;

and the one-year statute of limitations for the violation of the Tennessee Consumer Protection

Act. Mr. Burrow’s counter-claims were originally filed on June 20, 2007, which is over nine

years from the March 21, 1998 approval of the contested amendments to the restrictive

covenants.

We have previously determined that Grand Valley’s amendments to its restrictive

covenants were not void ab inito for failure to comply with the applicable procedure.

Consequently, Mr. Burrow’s first argument that statutes of limitations do not apply to void

instruments is not well taken.

Because Mr. Burrow’s counter-claims were filed over nine years after the amendments

were approved, it is obvious that all applicable statutes of limitation had expired by this time.

Mr. Burrow cites Tennessee Code Annotated Section 28-1-114 as a “saving” statute, which

he argues tolls the application of the statutes of limitation in this case. Tennessee Code

Annotated Section 28-1-114 provides, in relevant part, that:

(a) A counterclaim or third party complaint or cross-claim is not

barred by the applicable statute of limitations or any statutory

limitation of time, however characterized, if it was not barred at

the time the claims asserted in the complaint were interposed.

This lawsuit was initiated when Grand Valley filed its original complaint on March

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25, 2002, which was just over four years from the date of the amendments to the restrictive

covenants. Consequently, we concede that Tennessee Code Annotated Section 28-1-114

could have been applied in this case to “save” some of Mr. Burrow’s counter-claims that

were not time barred at the time of the filing of the complaint. Although, in denying his

claims, the trial court obviously did not apply Tennessee Code Annotated Section 28-1-114,

the court’s order does not state the reason(s) why the statute did not operate to “save” any of

Mr. Burrow’s claims. The lack of explanation in the order may be the result of the court’s

application of the doctrine of laches in this case, i.e., if laches applies then it would not be

necessary to determine whether Tennessee Code Annotated Section 28-1-114 stops the

tolling of the statutes of limitation.

“Unreasonable delay in pursuing rights calls the equitable doctrine of laches into play

to prevent assertion of stale claims.” Tennessee Pine Co. v. Via, No.

W1999-00558-COA-R3-CV, 2000 WL 34411147, at *5 (Tenn. Ct. App. Aug. 25, 2000)

(citing Nunley v. Nunley, 925 S.W.2d 538, 542 (Tenn. Ct. App. 1996)). However, delay, by

itself, is not sufficient to invoke the doctrine of laches. Id . The determinative test “is not the

length of time that has elapsed, but whether, because of such lapse of time, the party relying

on laches as a defense has been prejudiced by the delay.” Id. (quoting Nunley, 925 S.W.2d

at 542). “Generally, the doctrine of laches applies to actions not governed by a statute of

limitations.” Briceno v. Briceno, No. M2006-01927-COA-R3-CV, 2007 WL 4146280, at *4

(Tenn. Ct. App. Nov. 21, 2007) (citing Gleason v. Gleason, 164 S.W.3d 588, 592 (Tenn. Ct.

App. 2004); Dennis Joslin Co. v. Johnson, 138 S.W.3d 197, 201 (Tenn. Ct. App. 2003)).

Where the action is governed by a statute of limitations, the doctrine of laches may shorten

that time period if the plaintiff is guilty of gross laches by unreasonably acquiescing in

adverse rights for a long duration of time, causing “prejudice to the defendant such as the

loss of evidence and witnesses or a considerable accumulation of interest resulting from the

unjustified delay of the plaintiff.” Id. (citations omitted). “It is an equitable defense which

requires the finder of fact to determine whether it would be inequitable or unjust to enforce

the claimant's rights.” Estate of Baker v. King, 207 S.W.3d at 264. A trial court's decision

regarding whether to apply the doctrine of laches will not be reversed absent an abuse of

discretion. Id. at *3; Estate of Baker 207 S.W.3d at 264; Griffin v. Lester, No.

W2004-02072-COA-R3-CV, 2005 WL 3199279, at *5 (Tenn. Ct. App. Nov. 30, 2005);

Tennessee Pine Co., 2000 WL 34411147 at *6. Under the abuse of discretion standard, the

trial court's decision “will be upheld so long as reasonable minds can disagree as to the

propriety of the decision made.” Camp v. Camp, No. W2010–01037, COA–R3–CV, 2011

WL 2567542, at *5 (Tenn. Ct. App. June 29, 2011) (quoting Eldridge v. Eldridge, 42

S.W.3d 82, 85 (Tenn. 2001)). The abuse of discretion standard involves “a less rigorous

review of the lower court's decision and a decreased likelihood that the decision will be

reversed on appeal.” Lee Medical, Inc. v. Beecher, 312 S.W.3d 515, 524 (Tenn. 2010)

(citing Beard v. Bd. of Prof'l Responsibility, 288 S.W.3d 838, 860 (Tenn. 2009)). The

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standard “reflects an awareness that the decision being reviewed involved a choice among

several acceptable alternatives.” Lee Medical, Inc., 312 S.W.3d at 524 (citing Overstreet v.

Shoney's, Inc., 4 S.W.3d 694, 708 (Tenn. Ct. App. 1999)). Accordingly, appellate courts are

not permitted to “second guess” the trial court's determinations or to substitute their judgment

for that of the trial court. Lee Medical, Inc., 312 S.W.3d at 524 (citing White v. Vanderbilt

Univ., 21 S.W.3d 215, 223 (Tenn. Ct. App. 1999)). “The abuse of discretion standard of

review does not, however, immunize a lower court's decision from any meaningful appellate

scrutiny.” Lee Medical, Inc., 312 S.W.3d at 524 (citing Boyd v. Comdata Network, Inc., 88

S.W.3d 203, 211 (Tenn. Ct. App. 2002)).

In arguing that the doctrine of laches should not apply in this case, Mr. Burrow states

that he first became aware “of the actual numerical results of the March 2[1], 1998 vote

during the pendency of discovery in this matter [i.e., July 12, 2006].” While the “discovery

rule” doctrine may apply “to alleviate the intolerable result of barring a cause of action by

holding that it ‘accrued’ before the discovery of the injury or wrong,” see, e.g., Foster v.

Harris, 633 S.W.2d 304, 305 (Tenn. 1982), even giving Mr. Burrow every reasonable

inference in his favor, the record simply does not support his contention that he was unaware

of the amendments until late in the discovery process.

By his own admission, Mr. Burrow “was advised that there was going to be a vote on

March 21st.” Although he further states that he “was unaware that a vote did occur,” it is

undisputed that Grand Valley sent a Notice to all members and further posted the Notice in

the Subdivision common areas. There is no indication in the record that Mr. Burrow failed

to receive the Notice mailing, which also, as noted above, included the proposed

amendments. Furthermore, it is undisputed that, on April 2, 1998, the amended and restated

restrictive covenants and bylaws were filed with the Hardeman County Register’s Office

pursuant to Tennessee Code Annotated Section 66-24-101. Tennessee Code Annotated

Section 66-26-102 provides: “All of the instruments registered pursuant to § 66-24-101 shall

be notice to all the world from the time they are noted for registration, as prescribed in §

8-13-108; and shall take effect from such time.”

Even assuming that the record supports a finding that Mr. Burrow did unreasonably

delay his contest of the amended restrictive covenants, delay, alone, is not sufficient to

trigger the application of the equitable doctrine of laches. The party relying upon laches must

also have been prejudiced by the delay. In the instant case the trial court’s order merely

states that laches applies, but it does not state the grounds for that finding, and specifically

does not address what, if any, prejudice Grand Valley suffered as a result of Mr. Burrow’s

inaction. Unlike the question of whether Grand Valley properly followed its procedure for

amending the restrictive covenants, the question of whether laches should apply is very fact

specific as it involves a weighing of the equities between the parties. In the absence of

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Tennessee Rule of Civil Procedure 56.04 findings, this Court cannot determine the trial

court’s reasoning in applying laches and in failing to apply Tennessee Code Annotated

Section 28-1-114. Therefore, if this Court were to proceed with adjudication of the issue of

whether the doctrine of laches was properly applied in this case, we would, at best, be

speculating as to the reasoning behind the trial court's decision and the facts it considered.

In short, “[w]e cannot proceed with a review, speculating on the legal theories upon which

the trial court may have ruled and the legal conclusions the trial court may have made.”

Winn, 2010 WL 2265451, at *6. We must remand this case to the trial court for compliance

with Tennessee Rule of Civil Procedure 56.04 on the dismissal of Mr. Burrow’s counter-

claims. As mentioned above, if the doctrine of laches does not apply or if Tennessee Code

Annotated Section 28-1-114 is applicable to “save” Mr. Burrow’s counter-claims, then the

grant of summary judgment in favor of Grand Valley was premature. Consequently, we must

vacate the order of the trial court and remand for further proceedings consistent with this

Opinion, including compliance with Tennessee Rule of Civil Procedure 56.04 by stating the

legal grounds upon which the court denied Mr. Burrow’s counter-claims.

Because we cannot determine whether Mr. Burrow’s counter-claims were properly

dismissed and, thus, whether the grant of summary judgment in favor of Grand Valley was

proper, we pretermit the remaining issues concerning the grant of the motion to alter or

amend, the award of attorney’s fees, and the award of pre-judgment interest.

For the foregoing reasons, we vacate the judgment of the trial court and remand for

further proceedings consistent with this opinion. Costs of this appeal are assessed one-half

to the Appellant, Dennis Burrow, and his surety, and one-half to the Appellee, Grand Valley

Lakes Property Owners Association, Inc., for which execution may issue if necessary.

_________________________________

J. STEVEN STAFFORD, JUDGE

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